As the coronavirus pandemic amplifies longstanding concerns over the world’s economic dependence on China, many countries are trying to reduce their exposure to Beijing’s brand of business.
Japan has set aside $2.2 billion to help companies shift production out of China. European trade ministers have emphasized the need to diversify supply chains. Several countries, including Australia and Germany, have moved to keep China, among others, from buying businesses weakened by lockdowns. Hawks in the Trump administration also continue to press for an economic “decoupling” from Beijing.
But outside government circles, in the companies where the decisions about manufacturing and sales are actually made, the calculations are more complex.
China is a hard habit to break.
Even after its early mishandling of the coronavirus disrupted the country’s ability to make and buy the world’s products, further exposing the faults of its authoritarian system and leading it to ratchet up its propaganda war, China’s economic power makes it the last best hope for avoiding a protracted global downturn.
“When this all started, we were thinking, Where else can we go?” said Fedele Camarda, a third-generation lobster fisherman in Western Australia, which sends most of its catch to China. “Then the rest of the world was also compromised by the coronavirus, and China is the one getting back on its feet.”
“Although they’re just one market,” he added, “they’re one very big market.”
To understand how businesses are responding to the shifting dynamics and risks, The New York Times profiled three companies in three countries that are heavily reliant on China. Their experiences vary, but they are all trying to work out just how much of a breakup with China is needed — or whether they can afford one.